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09-12-2005 EDA MINMEETING OF THE ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY HELD AT THE ELK RIVER CITY HALL MONDAY, SEPTEMBER 12, 2005 Members Present: President Gongoll, Commissioners, Dwyer, Farber, Klinzing and Moon Members Absent: Commissioners Gumphrey and Tveite Staff Present: Assistant Director of Economic Development Heidi Steinmetz, City Administrator Pat Klaers, Community Development Director Scott Clark, and Recording Secretary Debbie Huebner 1. Call Meeting To Order Pursuant to due call and notice thereof, the meeting of the Economic Development Authority was called to order at 5:30 p.m. by President Gongoll. 2. Consider Agenda MOVED BY COMMISSIONER FARBER AND SECONDED BY COMMISSIONER KLINZING TO APPROVE THE SEPTEMBER 12, 2005 EDA AGENDA WITH THE FOLLOWING ADDITION: ITEM 8. -OTHER BUSINESS: GREAT RIVER ENERGY UPDATE MOTION CARRIED 5-0. Consider Consent Agenda MOVED BY COMMISSIONER MOTION AND SECONDED BY COMMISSIONER DWYER TO APPROVE THE CONSENT AGENDA AS FOLLOWS: 3.1. AUGUST 8, 2005 MINUTES 3.2. CHECK REGISTER 3.3. BALANCE SHEET 3.4. REVENUE/EXPENDITURE REPORT MOTION CARRIED 5-0. 4. Open Mike No one appeared for open mike. 5. Strategic Industrial Marketing Update Assistant Director of Economic Development Heidi Steinmetz reviewed highlights of the Strategic Industrial Marking Update report to the EDA. Economic Development Authority Minutes September 12, 2005 Page 2 Technical Assistance Program - Ms. Steinmetz provided background information regazding the $5,000 match grant from the Initiative Foundation regazding the two-year partnership program with Minnesota Technology, Inc. (MTI). She noted that recently Elk River Machine received a $2,000 Technical Assistance Program grant for strategic planning assistance provided by MTI. She stated that the grant period actually ended on May 31~, but staff requested and received an extension until the end of 2005. 2. Joint Event with MTI - Ms. Steinmetz stated that the purpose of the event was to provide an education experience to azea manufacturers and to promote the Technical Assistance Program. MTI representatives commented that it was one of the best- attended events they have hosted, with approximately 40 people attending. 3. Minnesota Manufacturing and Technology Week, October 17-21, 2005 - Ms. Steinmetz explained that staff is working with the Elk River Area Clraarber of Commerce on this event which will include a tour of two local manufacturers, a luncheon, and speaker. President Gongoll noted that the site visits will hopefully be held at Gradient Technology and Orluck Industries. Dr. Fred Zimmerman, an expert in the manufacturing industry senor, will be the speaker. He noted that the luncheon is proposed to be held at the City's EOC (Emergency Operations Center). President Gongoll stated that he also attended the MTI event and it was well-attended by local manufacturers of Elk River and surrounding communities. 6. Northstar Business Park Update Ms. Steinmetz reviewed the Northstaz Business Park project schedule, noting that the City Council approved the bid and awarded the contract for the improvements to Northdale Construction Company. She noted that tree clearing and grading has begun on the site. The City Council will hold the assessment hearing and consider adopting the assessment roll on October 3~d. The prospective buyers will be closing on the properties in late September/early October. At that time the properties will be ready for construction. Ms. Steinmetz asked the Commission to provide feedback on the concept design of the entrance monument sign. Commissioner Moon asked if the there would be any City control of the property, once the project is fully built-out. He stated that he had a concern using the City logo if the City no longer has control over the property in the future. Corxurrissioner Dwyer asked how many lots will be left after the pending sales are completed. Ms. Steinmetz stated there will be 3 - 41ots left. Ms. Steinmetz stated that the sign could be designed so that the Elk River logo could be removed when the project is sold out. Comtnissioner Klin~ing suggested that the sign could read "a project of the City of Elk River" and list the names of the businesses. Ms. Steinmetz stated that staff will work on a revision. Consider Micro Loan for Provo Enterpxises, LLC (Alliance Machine, Inc. Property) Ms. Steinmetz stated that the City Council has approved Tax Abatement for Provo Enterprises, LLC in addition to the Sherburne County Board of Commissioners. Ms. Economic Development AutltorityMinutes September 12, 2005 Page 3 Steinmeu reviewed the Provo Enterprises, LLC Micro Loan request. She stated that the Finance Committee reviewed the request on August 17, 2005 and recommended approval of the request. She reviewed the recommended teens of the Micro Loan. President Gongoll suggested that in the interest of time, that the City Council public hearing be waived, since it is not required by Statute for loans $100,000 or less. Commissioner Moon stated that he did not have an issue with waiving the public hearing, but that he did not want to set a precedence, since the Commission has held public hearings on other loans, when a public hearing was not required. President Gongoll noted that two public hearings for this project have akeady been held, although not for the Micro Loan component. MOTION BY COMMISSIONER MOTIN, SECONDED BY COMMISSIONER FARBER TO RECOMMEND APPROVAL OF THE APPLICATION FROM ALLIANCE MACHINE, INC. FORA $100,000 INDUSTRIAL INCENTIVE MICRO LOAN TO PROVO ENTERPRISES, LLC PER THE RECOMMENDATION OF THE FINANCE COMMITTEE AND TO WAIVE THE PUBLIC HEARING BASED ON THE FOLLOWING TERMS: RATE - FDCED, 2 POINTS BELOW PRIME WITH A THREE PERCENT FLOOR; TERM - 15-YEAR AMORITIZATION, UP TO A 5-YEAR BALLOON PAYMENT; SECURITY -SECURED BY 2NO POSITION ON THE REAL ESTATE, PERSONAL GUARANTEE FROM OWNERS AND SPOUSES; STRUCTURE -PARTICIPATION LOAN WITH THE BANK OF ELK RIVER; JOB PERFORMANCE AGREEMENT - 9 NEW FULL-TIME JOBS IN ELK RIVER WITH A $15.00 MINIMUM HOURLY WAGE. MOTION CARRIED 5-0. Commissioner Klinzing questioned the comment in the August 17, 2005 EDA Finance Corrunittee draft minutes regarding the appropriateness of the loan. Comrissioner Motin stated that the question was raised as to whether or not it was appropriate to give a low interest loan, as well as the Tax Abatement, and could this be considered "double-dipping" The Finance Committee will discuss this issue on September 28, 2005. Cotntnissioner Klinzing noted that it should be good discussion. 8. Outer Business President Gongoll introduced Scott Clark, the City's new Community Development Director. President Gongoll stated that a meeting with Great River Energy (GRE) was called by Senator Mike Jungbauer and his staff. Representatives from the City, the Senator's office and GRE were in attendance, including David Saggau, the new CEO, Larry Schmid, Rick Lancaster, and Mike Finley. He stated that Senator Jungbauer talked about Elk River as Energy City, the Mayor talked about the City's Preliminary Siting & Financing Proposal submitted on July 29, 2005 to GRE, and Vance Zehringer made a good presentation of the efforts and accomplishments of Energy City. Mr. Saggau of GRE stated that the GRE Board approved the headquarters relocation project, which means that they will begin looking for a site for their new headquarters and stated that Elk River is on their "short list". Economic Development Authority Minutes September 12, 2005 Page 4 President Gongoll felt that the City's proposal is strong and that the City work with GRE on the challenges that the site presents. He expressed his thanks to Senator Jungbauer for facilitating the meeting. Commissioner Klinzuig added that the meeting gave the City an opportunity to tell GRE that they are an important part of Elk River. She stated that she felt the City had said everything that can be said and now it is up to GRE to make a decision. Ms. Steinmetz indicated that she lefr out a significant update from the earlier Northstar Business Park report, which was the fact that staff was notified on August 23~d that the City's Business Development Infrastrucrure Grant application was approved by the Minnesota Department of Employment & Economic Development (DEED) in the amount of $495,000 for infrastructure improvements to Northstar Business Park. 9. Adjournment There being no other business, President Gongoll adjourned the meeting. The meeting of the Elk River Economic Development Authority adjourned at 6:05 p.m. Su/b~m6it~te~d b``y:/~ ~ ~0%ovct XYIuAn.-._ Recording Secretary